Resource Mystery on Baker Street

MYSTERY ONBAKER STREET

BRUTAL KAZAKH OFFICIAL LINKED TO £147M LONDON PROPERTY EMPIRE

JULY 2015

Big chunks of Baker Street are owned by a mysterious figure with close ties to a former Kazakh secret police chief accused of murder and money-laundering.

1 MYSTERY ON BAKER STREET Brutal Kazakh official linked to £147m London property empire

EXECUTIVE SUMMARY

The ability to hide and spend suspect cashoverseas is a large part of what makes serious corruption and organised crime attractive. After all, it is difficult to stuff millions under a mattress. You need to be able to squirrel the money away in the international financial system, and then findsomewhere nice to spend it.

Increasingly, London’s high-end property market

seems to be one of the go-to destinations to give

questionable funds a veneer of respectability. It

offers lawyers who sell secrecy for a living, banks

who ask few questions, top private schools for your

children and a glamorous lifestyle on your doorstep.

Throw in easy access to anonymously-owned

offshore companies to hide your identity and the

source of your funds and it is easy to see why

London’s financial system is so attractive to those

with something to hide.

This briefing uncovers a troubling example of how

London can be used by anyone wanting to hide

their identity behind complex networks of companies

and properties. Global Witness’ investigation reveals

that a portfolio of real estate worth £147 million in

well-known London locations appears to be currently

owned by someone with ties to Rakhat Aliyev, a

notorious figure from Kazakhstan, accused in the

EU of money laundering and murder.

Aliyev was the son-in-law of President Nazarbayev

of Kazakhstan and is alleged to have used his

position as the former deputy head of the country’s

secret police to amass a vast business empire. He

was found hanged in an Austrian jail cell in February

2015 where he was being held on charges of murder.

His multi-millionaire eldest son, Nurali Aliyev, was

recently appointed the deputy mayor of Kazakhstan’s

capital city, Astana. According to recent reports,

Nurali, who studied at Sandhurst Military Academy

in the UK, is being groomed to be President

Nazarbayev’s successor.

Global Witness’ investigations reveal numerous links

between Rakhat Aliyev, Nurali Aliyev, and high-end

London property. The majority of this property

surrounds one of the city’s most famous addresses,

the fictional home of Sherlock Holmes located at

221b Baker Street.1 The property included (until

2009) the freehold of the Beatles Store located

at 231 Baker Street and the iconic Elvis Presley

souvenir shop at 233 Baker Street.2

The companies that own these properties and the

people that manage them have denied that Rakhat

Aliyev was the true owner, but have refused to identify

the actual owner, citing reasons of confidentiality.

However, there are a number of worrying links between

Rakhat Aliyev and his family and the London properties:

two of the people that oversee the properties have

worked in companies owned by Rakhat Aliyev, and

a third has worked in a company managed by Nurali

Aliyev. Given the denials and secrecy surrounding

the ownership of these properties, and Rakhat

Aliyev’s recent death, there is an urgent need for

the UK authorities to investigate who truly is the

ultimate owner of this property empire.

Rakhat Aliyev. (Credit: SHAMIL ZHUMATOV/X00499/Reuters/Corbis)

MYSTERY ON BAKER STREET Brutal Kazakh official linked to £147m London property empire 2

That Aliyev and members of Kazakhstan’s first family can even be linked to expensive property in such a recognisable address is troubling, but it is not an isolated case. It is a product of the opacity ofthe UK’s property market and the global use of“anonymous companies”, which allow suspect people to hide behind companies registered in secrecyjurisdictions such as the British Virgin Islands (“BVI”) and use “nominee” directors. All of this makes it very easy to obscure the true owner of Londonproperty from the authorities and avoid detection (see page 16 of this report). And this is a very common practice. At least £122 billion worth of property in England and Wales is now owned by companies registered offshore, and 75% of properties whose owners are under investigation for corruption make use of this kind of secrecy to hide their identities.3

This system of secrecy facilitates and entrenches the corruption that keeps citizens in poor countries poor, robs people of their futures, and threatens global stability. It allows human rights abuses to persist in countries around the world. It is why, for example, the Gaddafi family were able to sink £10 million into a mansion in Hampstead, before Libya’s citizens got so fed up with the obvious corruption and abuse that they poured onto the streets in protest.

This issue is also a major blot on an otherwise promising record. The UK has recently taken bold and meaningful steps towards tackling corruption, most notably by committing to public registries of the real owners of companies4 and by PrimeMinister David Cameron putting the UK’s fight against corruption at the heart of the G7’s agenda.5 This progress will be undermined unless the UK takes meaningful steps to keep corrupt money out of one of the world’s great cities.

It doesn’t have to be this way. London is attractivefor so many good reasons – it doesn’t need toattract the criminal, the corrupt and their relatives, and thereby play a central role in fuelling corruption and abuse in some of the poorest or most violent countries in the world. This exposé shows the key allegations against Rakhat Aliyev, members of his family, and a network of associated companies, calls for an investigation into the assets owned by those companies in the UK, and highlights the

loopholes that allow dubious money to be brought into the UK. It sets out next steps for the UK authorities and explains how the law should be changed to stop suspect money from entering the UK’s property market in the future. If properly implemented, these changes could go a long way to stopping suspect individuals such as Aliyev, as well as dictators and their offspring, drug lords, terroristsand other criminals from abusing the rights of people overseas and moving their money into the

UK by using anonymous companies.

RECOMMENDATIONS

Global Witness calls for changes to the laws around UK property to increase transparency in the property market:

• At the time of acquiring property, companies should be required to submit to the Land Registry information about their ultimatebeneficial owners, which should be madepublic (unless a legitimate exemption on the basis of personal safety applies). This would be in line with the UK’s new registry of company“beneficial owners” that identifies the real people that control and benefit from UKcompanies. It is currently too easy to circumvent this transparency initiative taken by the UK government by using an anonymous company to purchase UK properties.

• Real estate agents’ anti-money laundering responsibilities should be extended to include due diligence checks on buyers and not just the sellers of UK property. These checks should include ensuring that the purchasing company has declared its beneficial owners and that appropriate checks have been carried out on those individuals.

• The UK Government should consolidate its leadership role on company ownershiptransparency by convincing the British Overseas Territories and Crown Dependencies to create their own public registers of beneficial ownership.

Global Witness calls for the following steps to be taken in relation to Rakhat Aliyev and the properties outlined in this report:

RECOMMENDATIONS


1. ALIYEV’S DARK PAST: ALLEGATIONS OF MONEY LAUNDERING AND MURDER

In February 2015 Rakhat Aliyev was found hanged in his cell in Austria, where he was being held on charges of murder6 after the bodies of twobankers were found stuffed into lime-filled barrelsin Kazakhstan.7 Aliyev was a notorious figure in his home country, and at first glance his death appeared to put an end to one of the murkiest chapters in independent Kazakhstan’s short history. Considered part of the ‘first family’, having married Dariga Nazarbayeva, the eldest daughter of the President of Kazakhstan,8 Aliyev had also occupied senior roles in the Kazakh tax police and the KNB, the successor organisation to the KGB.9 During his time in power, Aliyev appears to have amassed a vast business empire. At the time of his apparent suicide,money-laundering investigations into Aliyev’s business interests were ongoing in several EU countries.10

Around the same time that Aliyev’s power inKazakhstan was waning, that of his eldest son, Nurali, was ascending. Nurali studied at Sandhurst Military Academy in the UK11 and then went into business in Kazakhstan, amassing an estimated fortune of US$200 million.12 In December 2014, he was appointed the deputy mayor of Kazakhstan’s capital city, Astana, which is his first official politicalrole.13 Considered to be Nazarbayev’s favourite grandchild, Nurali is reportedly being groomed to be the president’s successor.14

Kazakhstan maintains a reputation of being a‘kleptocracy’ – a country run primarily in the interests of the president’s family and its close associates. The US State Department, for example, has voiced concerns in its reports over the dominance ofKazakhstan’s ruling elite,15 and Global Witness’ 2004 report, Time for Transparency, examined allegations that President Nazarbayev and another Kazakh official received personal benefits in relation to the country’s oil deals.16

Global Witness has taken a close look at exactly how Aliyev’s assets were acquired and what happened to them after he left Kazakhstan. This investigationhighlights the fact that Aliyev appears to have reorganised his EU assets in 2010, at the same time that a group of companies with an unknown owner acquired a collection of prime London property. The companies in question have denied that Aliyev is theirultimate owner but have refused to identify who is. This means that a large chunk of one of London’s mostfamous streets is currently owned by persons unknown.

Although the true owner of these properties remains a mystery, Global Witness’ investigation shows there are connections to Aliyev’s inner circle and the Kazakh “ruling family”.

Global Witness is therefore calling for an investigationinto this portfolio of companies and the property it owns. In addition, Global Witness is calling for the UK government to push for transparency in the UK property market and in the company registers of the British Overseas Territories and Crown Dependencies (see recommendations on page 2).

The British Virgin Islands does not provide shareholder or beneficialownership information on its companies. (Credit: Flickr: Robert Matthews)

• The UK authorities must investigate whether any of Aliyev’s allegedly stolen Kazakh funds have ended up in the UK and consider whether there are grounds for freezing any suspected Aliyev assets until the investigation is complete.

• In particular, any lawyers, banks and real estate agents identified by an investigation as having been knowingly involved in company acquisitions and property purchases on behalf of Aliyev should be investigated by their relevant regulatorybodies and appropriate action should be taken.


MURDER AND TORTUREALLEGATIONS

The final chapter in Aliyev’s life started back in

2007 after a very public fall from grace saw him

exiled to Austria, where he served as Ambassador

of Kazakhstan from 2002-2005.17 Aliyev claimed

that his removal from public office and expulsion

from Kazakhstan had only occurred because of his

desire to run against President Nazarbayev in the

2012 Kazakh presidential election.18 The Kazakh

authorities viewed it differently, accusing him of

plotting a coup against the president, finding him

guilty in absentia in 2008, and sentencing him to

twenty years in prison.19

Aliyev was forced to go into hiding,20 first in Austria

and then reportedly to Malta and Cyprus.21 He said

that he believed his life was in danger,22 and that

he had been the victim of a personal vendetta by

President Nazarbayev. He said Nazarbayev had

instigated further fabricated criminal charges and

proceedings against him “for crimes [he] did not

commit”23 including the abduction of the two

Kazakh bank officials.24

Aliyev was embroiled in many legal cases involving

himself, relatives and other Kazakh businessmen-

turned-dissidents, but doubt was cast on his

reliability as a witness during these proceedings.

Forbes reported that in several legal cases he had

been forced to withdraw documents that attempted

to show, falsely, that he was the victim of a conspiracy

involving former world leaders such as Bill Clinton

and Tony Blair, who were supposedly working with

Kazakh authorities to frame Aliyev and extradite

him to Kazakhstan. According to Forbes, documents

were deemed to be forgeries by a leading expert in

the field.25

Aliyev claimed he’d “learnt a great deal about

European democracy” during his time in Vienna.26

However, many who had lived in Kazakhstan when

Aliyev was a public official were more sceptical

about his pro-democracy credentials, and cast serious

doubt on his story as an innocent victim of the

Kazakh regime.

The Austrian authorities conducted their own

investigation into the murder of the Kazakh bank

officials27 – whose bodies were found in 201128 –

and charged Aliyev with these murders in December

2014, after he had returned to Vienna to give himself

up.29 He had already been convicted of their

abduction in absentia in Kazakhstan.30 Following

his death in custody in February 2015, reports

have surfaced that the Kazakh government used

its funds to try to influence international media

and politicians against Aliyev and to lobby for his

prosecution in Austria.31 Aliyev’s supporters argue

that the current Kazakh regime has used the legal

system in Austria and other European countries to

run a vendetta against him.32

However, some of the accusations against Aliyev

have been levied by individuals who are not linked

to the current Kazakh regime. They include a

former bodyguard of Akezhan Kazhegeldin, the

Prime Minister of Kazakhstan from 1994-1997.33

Kazhegeldin’s bodyguard alleges that he was

tortured personally by Aliyev, who was then working

in the KNB, in a bid to extract a forced confession

that Kazhegeldin was planning to overthrow

Nazarbayev.34 Kazhegeldin blames Aliyev for

orchestrating events that saw Kazhegeldin forced

out of Kazakhstan.35

Rakhat Aliyev was investigated for money laundering.


EU INVESTIGATIONS

Aliyev claimed that he was the target of anorchestrated campaign by the Kazakh authorities to discredit him; however, there appears to have been enough evidence for law enforcement agencies of several EU countries to launch investigations into money laundering and other financial crimes. According to Deutsche Welle, an investigation

regarding money laundering in Germany was

confirmed by a regional prosecutor’s press service.36

Other investigations into money laundering were

reported in Austria in 200737 and Malta in 2013,

and were the subject of a written question to the

European Parliament.38 The Maltese authorities

went as far as to freeze the assets of Aliyev and his

second wife, Elnara Shorazova, in February 2014.39

The Maltese authorities confirmed to Global Witness

that the asset freeze was still in place as of June

2015.40 According to lawyers working on behalf of the

Kazakh authorities, Aliyev is accused of laundering

€100 million through Malta, money which was allegedly

obtained by illegal means, including receiving bribes

from businessmen when he was working at the

KNB.41 So, while Aliyev’s supporters may seek to

use his feud with President Nazarbayev as a blanket

retort to any allegation of wrongdoing made against

him, it is clear that enough authorities and individuals

that are not linked to the current Kazakh regime

have also made serious allegations against Aliyev.42

Until now there has been little public discussion

about possible Aliyev assets in the UK, perhaps

because they are so cloaked in secrecy. One of the

main difficulties in trying to ascertain who owns a

particular property in the UK is the fact that the

ultimate ownership is often hidden behind “anonymous

companies”, that is, offshore entities registered

in secrecy jurisdictions, such as the BVI. In most

countries, it is possible to hire a “nominee” owner –

someone paid to take on the legal responsibility of

a company – to further distance the real person

behind the money from the company, and by extension

the property. The use of anonymous companies and

nominees is legal in the UK at present, meaning

that they can provide the cover of secrecy and the

veneer of legitimacy for those with something to hide (see page 16 of this report).

By his own admission, Aliyev appeared familiar with these practices in a written statement he gave to

London’s High Court in relation to another case: “The use of nominees is quite common in Kazakhstan... In our country we use friends, relatives or acquaintances as nominees. These are, quite simply, the rules of the game.”43 In a draft version of his statement,

Aliyev suggested that what was normal practice in Kazakhstan may be viewed as suspicious elsewhere: “Our laws are imperfect, and you can do certain things that are not against the law but would be viewed as suspect in the West.”44

Given his murky past, it is perhaps unsurprising that while official records show his death in 2015

to be a suicide, Aliyev’s supporters claim foul play.45 An independent commission has been set up in Austria to investigate.46

Yet how Aliyev died is not the only mystery that needs

solving. Investigations by Global Witness reveal for the first time that companies and people that can be directly and indirectly connected to Rakhat

Aliyev and Nurali Aliyev are behind a portfolio of British companies that own £137 million worth of

property on Baker Street and a £9.3 million mansionin Highgate. Now that Rakhat Aliyev is dead, the

ownership of those properties is even more of a mystery. The next section examines the evidence that links Aliyev to these UK properties and raises

concerns over Aliyev’s funds and business empire.

Baker Street, London. (Credit: Flickr: Toby Oxborrow)


2. THE MYSTERY OF 219 BAKER STREET

221b Baker Street is a location that is familiar to many people. Billed as “the World’s Most Famous Address”,47 it is the home of the UK’s most celebrated fictional detective, Sherlock Holmes, and his faithfulside-kick, Dr John Watson. Today, people flock from around the globe to visit the site.48 In a shop two doors down (at 231 Baker Street) sits a tribute to another of the UK’s cultural icons: the London Beatles Store.49 And next door at 233 Baker Street until 2010 sat “Elvisly Yours”, a home of Elvis memorabilia, and a landmark that formed part of “the knowledge” for London’s cabbies.50

Due to a quirk of history, “221b Baker Street” –

that is, the Sherlock Holmes museum on Baker

Street – is not physically located at 221 Baker

Street. Rather, it sits next to 237 Baker Street.51

The real 221 Baker Street is part of a larger block

of commercial and residential properties that spans

from 215 to 237 Baker Street.52 This block of

freehold and leasehold title is in total worth

approximately £137 million, according to Land

Registry records. It is owned by a portfolio of

companies that are ultimately (and anonymously)

owned by a company in the BVI.

By tracing links between these companies and

companies known to be owned or directed by Rakhat

Aliyev and his son Nurali Aliyev, Global Witness

has pieced together evidence that suggests that

someone close to Rakhat Aliyev was the true owner

of the BVI company that controls this big chunk of

Baker Street, including some of its most famous

property. The companies in question have denied

that Rakhat Aliyev was ever their owner, but have

refused to reveal the true owner’s identity, citing

confidentiality reasons. The difficulty in identifying

who sits behind such a lucrative collection of real

estate – especially in light of its connections to

Aliyev through his second wife and eldest son –

demonstrates the urgent need for transparency in

the UK’s property market and its system of company

ownership. This report raises questions about the

checks and balances that govern the UK’s property

market, and argues that individuals who own lucrative

real estate should not be able to hide their identity

behind complex corporate veils.

The network of companies in question was put

together as follows:53

• Between 2008 and 2010 four different UK

companies – all controlled by the same BVI

company – acquired a collection of leasehold

and freehold properties between 215 and 237

Baker Street, two properties near Hyde Park

and a mansion in Highgate, London.

• The four UK companies in question were:

Farmont Baker Street Limited (“Farmont”);

The London Beatles Store. (Credit: Flickr: Gate C21)

Elvisly Yours. (Credit: Flickr: Jens Naehler)


Dynamic Estates Limited (“Dynamic”); Parkview Estates Management Limited (“Parkview”)and Greatex Limited. Farmont differed from the other companies because it was a pre-existing company engaged in the property business that acquired a new owner in April 2009.

• The total value of these acquisitions comes to just over £147 million.

• Dynamic and Parkview are wholly owned subsidiaries of Farmont. According to company accounts, Greatex Limited was not part of the same corporate group, but it regards Farmont’s ultimate controlling company – the company in the BVI – as its owner.

• The BVI company at the top of the network has changed almost every year from 2008 until the present day. This, combined with the secrecy laws in the BVI, means the identity of the true owner of these companies (and their properties) is not publically available. The BVI registry does not even go so far as to provide shareholder information on its companies. Although Global Witness has approached for comment the companies and individuals that are most likely to know who the true owner of the properties is, that information has been withheld on the basis of confidentiality.54

The timeline of UK property acquisitions is as follows:

• In April 2008, Parkview purchased a mansion in Highgate for £9.3 million. In March 2013, ownership was transferred to a Panamanian entity, Villa Magna Foundation (“Villa Magna”). The purchase is identified in the Land Registrytitle document as being made ‘care of’ Parkview.

• In April 2009, Greatex Limited purchased the freehold to the block of Baker Street containing the London Beatles Store and Elvisly Yours. After just six months, Greatex Limited agreed to sell it on to another BVI company for a £1.12 million gross profit.

• Dynamic made the most valuable acquisition in March 2010, when it purchased for £98.475 million the leasehold pertaining to land and buildings around 219 Baker Street.

• Greatex Limited also held the lease on two properties near Hyde Park. One of those leases, worth £1 million, was sold to a company

registered in Jersey in April 2013.• All of these property acquisitions by Farmont,

Dynamic, Parkview and Greatex Limited, totallingjust over £147 million, appear to have been made without a mortgage or bank loan.

It is no surprise that these complex arrangements are hard to untangle – they appear to have been designed to be that way. The links between these UK properties and Rakhat Aliyev will be discussed below, but the individuals and companies implicated flatly deny that Aliyev is or ever was the ultimate owner of this property portfolio. The links between such valuable property and a shady character like Aliyev are troubling, however, and the fact that the properties’ owner remains a mystery despite a lengthy Global Witness investigation demonstrates the danger of such secrecy being allowed to persist in the UK’s property market and its system of company ownership.

So how do we deduce that Aliyev has links to these London properties? You could say it is elementary…

219 Baker Street. (Credit: Global Witness)


A TRAIL THROUGH EUROPE

Because BVI law keeps the identities of the true owners of companies registered there off the public record, it is impossible to identify who sits at the top of the network of companies that own the UK properties using public sources. However, many ofthe individuals that were directors of the companiesthat own, or have owned, the properties (that is,Farmont, Dynamic, Parkview, Villa Magna and GreatexLimited) can be connected to Rakhat Aliyev.

The trail starts in Germany and Austria. According to

documents seen by Global Witness, on 16 February

2012, Rakhat Aliyev gave testimony under oath to

the Maltese Magistrates Court in response to

questioning from the Austrian public prosecutor

that certain companies belonged to him:55 a German

metallurgy factory called Metallwerke Bender

Rheinland GmbH56 (“Metallwerke”) and its Austrian

parent company, Armoreal Trading GmbH (“Armoreal”).

There are further clear links between Armoreal and

Aliyev, for example a €20,000 Austrian hotel bill

issued to Armoreal for a week-long 2006 visit by

President Nazarbayev and Aliyev.57

Company registry documents also demonstrate clear

links between both companies, Aliyev and his second

wife, Elnara Shorazova. Shorazova is given as the

director/liquidator of Armoreal (which was dissolved

due to liquidation), and Shorazova’s father was a

director of Metallwerke between 2007 and 2010.59

The above clearly links Rakhat Aliyev to the companies

Metallwerke and Armoreal. The next step is to link

Aliyev to the companies that own the UK property.

Massimiliano Dall’Osso, an Italian citizen, was the

Managing Director of Metallwerke from August

2005 to February 2007.60 He also sat on the board

of directors of Armoreal, along with Shorazova, from

1 July 2005 until it was liquidated.61 Accordingly,

it appears that Dall’Osso has been working for

Aliyev since at least 2005. Global Witness wrote

to Dall’Osso to ask him for comment. His lawyers

said: “Our client was not aware of the Ultimate

Beneficial Owner (“UBO”) of these companies

[Metallwerke and Armoreal] in 2005 or at any

other time”.62 Dall’Osso may have been unaware of

who the ultimate owner was, but he should have

been aware of the company’s links to Aliyev as

it was reported in the media from at least 2009

that Shorazova was Aliyev’s wife63 – at which point

Dall’Osso was sitting alongside her on Armoreal’s

board. In the letter from his lawyers, Dall’Osso

does not deny knowing or working with Shorazova.

Dall’Osso is also the current64 director of Farmont,

Dynamic and Parkview, the companies that own the

properties in London.65 Perhaps Dall’Osso, despite

working for Aliyev and his wife in Armoreal and

Metallwerke, was representing another wealthy client

in the UK, one completely separate from Aliyev?

Indeed, Dall’Osso commented in his response to

Global Witness that: “At no time was Mr Aliyev the

UBO of [Farmont, Dynamic and Parkview].”66 Yet

Dall’Osso is not the only person who links Aliyev to

these property companies.

One of the entities that Aliyev swore under oath

belonged to him in 2012 was A.V. Maximus Holding.

A company with a very similar name – A.V. Maximus

SA – has been linked in news reports to A.V.

Maximus Holding AG and identified as being part

of Aliyev’s network.67 A.V. Maximus SA has as one

of its employees a man called Bernard Enry, a

French national, who occupied the role of director

The Highgate mansion owned by the Villa Magna Foundation boasts 7 bedrooms and an indoor swimming pool. (Credit: Global Witness)


for 11 years, from May 2003 to June 2014.68 Enry

is also a director of Villa Magna, the Panamanian

entity that owns the mansion located in Highgate,

a company which land registry records say is ‘care

of’ Parkview.69 In his response to Global Witness,

lawyers representing Enry said: “Rakhat Aliyev

never was the ultimate beneficial owner of the Villa

Magna Foundation. Confidentiality owed to Villa

Magna’s [sic] means that Mr Enry cannot tell you

who the actual beneficial owner is.” In a subsequent

letter following further questions from Global Witness,

Enry’s lawyers commented that Enry was not aware

of “Maximus” companies which may have been

registered outside of Switzerland. Enry’s lawyers did

not respond to our allegation that Enry has known

or associated with Aliyev and/or Shorazova.70

This is the second example of someone who is

involved in the property companies who can be

connected to Aliyev and Shorazova, and who has

not denied knowing or working with either of them.

The links don’t stop there.

CLENTW

ORTH

STREET

Clarence Gate G

ardens

Clarence Gate G

ardens

SIDD

ON

S LANE

MELCOMBE STREET

ALLSOP PLACE

BAK

ER STR

EET

CORNWALL TERRACE MEWS

Berkely Court

Dorset House

The ChevronsClub

SomersetHouse Hotel

MAP OF BAKER STREET PROPERTY

215-229BAKER STREET

Land to west side of

233-237 Baker Street


THE GREATEX CONNECTION

Greatex Limited, a UK company, provides an indirect link between Rakhat Aliyev and the UK properties. It owned the freehold of 231-237 Baker St (which included the Beatles Store and Elvisly Yours) from April 2009 until October 2009, when it agreed to sell the property for £1.12 million profit.

Greatex Limited was registered on 4 December

2007.71 Just two days after this, a company called

Greatex (Suisse) SA was registered in Geneva72 with

one Nurali Aliyev as its president. Nurali is Rakhat

Aliyev’s eldest son and he was 22 years old at the

time of the company’s registration.73

There is a further important link between the two

companies. Mukhamed Ali Kurmanbayev was

appointed a director of Greatex (Suisse) SA in

November 2007, a position he has informed Global

Witness he resigned from in August 2014, by which

time the company had been renamed G Wealth

Management SA.74 In March 2008, approximately

four months after becoming a director of Greatex

(Suisse), Kurmanbayev was also appointed director of Greatex Limited.75

In yet another link, another Greatex company was registered in 2007 – Greatex Trade & Investment

Corp.76 Although this is a BVI company, which again means that the identity of its shareholders and directors is not publically available – companyaccounts reveal that from 2008 to 2011 the Greatex Trade & Investment Corp wholly owned

Greatex Limited and from 2010 to 2011 was the ultimate controlling party of Farmont.

Global Witness has not found any concrete evidence of ownership ties between Greatex (Suisse) SA and

Greatex Limited and its 2010-2011 controlling party Greatex Trade & Investment Corp, yet the

similarity in their names, the close proximity of the dates of registrations, and the fact that Kurmanbayev has been a director at two of the companies call for

an investigation into whether the same people may be behind all three. As Aliyev’s son was president of

Greatex (Suisse) SA it is not unreasonable to assume

that a member of the Aliyev family could be behind

Greatex Limited and thus the property it owns.

Kurmanbayev, a Kazakh citizen – whose LinkedIn

profile states that he is a “lawyer with education in

Kazakhstan and UK, experience in commercial and

governmental affairs” – has a further role to play

in the story. Before Dall’Osso became the director

of Farmont and Dynamic in 2014, Kurmanbayev

served as the director of both, from May 2009 and

March 2010 respectively, until August 2014, when

he resigned and Dall’Osso took over. Kurmanbayev’s

LinkedIn profile says that he worked for “Parkview

Residence” (which shares an address with Farmont,

Dynamic and Parkview) from April 2009 until

August 2014, however he denies ever being a director

of Parkview Estates Management Limited (which

appears to manage the Baker Street properties).77

So Kurmanbayev – who has worked at a company

that Aliyev’s son was the president of – has worked

in two of the UK property companies that owned

£147 million of London property and for another –

Parkview Residence – that is clearly linked to the

other companies by virtue of its address.

In response to enquiries by Global Witness, lawyers

representing Kurmanbayev said that Rakhat Aliyev

was not the beneficial owner of the companies and

that “our client never had any relationship, whether

professional or personal with Rakhat Aliyev, either

directly or through intermediaries. Nor has our

client ever met with or had any professional or

personal relationship with Rakhat Aliyev’s widow,

Elnara Shorazova.” In a further letter, they confirmed

that Aliyev’s son, Nurali Aliyev, was the president

of Greatex (Suisse) SA. They added: “In about May

2007, Rakhat Aliyev was suspected as being involved

in the murder of two individuals. It is evidently clear

from all public domain reports that thereafter he

was ostracised from his family. […] Our client did

not join Greatex until November 2007. It is worth

noting that when our client joined Greatex, his

principal condition for accepting the position was

that Rakhat Aliyev was not involved in the business

and he would not be required to deal with him,

whether directly or indirectly. […] Furthermore, at


no time whatsoever was our client on notice that

any of his instructions were from Rakhat Aliyev, nor

that any of the transactions to which our client was

a party involved any criminal acts, including money-

laundering.”78

Global Witness does not suggest that Kurmanbayev

has knowingly had any dealings with Rakhat Aliyev

or was aware of any beneficial ownership by Rakhat

Aliyev of the relevant companies, nor do we suggest

that Kurmanbayev is implicated in any suspected

money laundering.

In conclusion, although Rakhat Aliyev never admitted

publicly to owning these UK companies (as he

admitted to others, under oath, when compelled

by the Austrian prosecutor), this is the first time

his links to UK property have come to light. The

evidence that Rakhat Aliyev, a member the Kazakh

first family, or someone close to them is involved in

the property, though not conclusive, is compelling:

• The current director of Farmont, Dynamic and

Parkview – which own the Baker Street and

Highgate properties – has worked for two

companies that are known to be owned by

Rakhat Aliyev.

• Greatex (Suisse) SA had as its president Aliyev’s

son, Nurali Aliyev. Greatex (Suisse) SA also shares

a former director with Farmont and Dynamic.

• Greatex Limited had the same controlling party

as the other property companies, Farmont,

Dynamic and Parkview.

• Therefore, whoever is the beneficial owner of

the BVI company that controls Greatex Limited

is also the beneficial owner of the other property

companies because Greatex Limited is owned

by the same BVI company as Farmont, Dynamic

and Parkview.

• Although Rakhat Aliyev can be linked to this

network of companies and the UK properties

they own, the companies and individuals

implicated have flatly denied that Rakhat Aliyev

is the beneficial owner. As such, the true

owner remains a mystery and an investigation

by the UK authorities is warranted.

3. ALIYEV’S HISTORY OF MONEY LAUNDERING,VIOLENCE ANDINTIMIDATION

These links between Rakhat Aliyev and such valuable UK property are concerning as they raise questions over the ability of the UK’s property market to be protected against money laundering risks, especially when foreign officials from kleptocratic states are involved.

Ever since Rakhat Aliyev entered public office in Kazakhstan there have been questions around his many businesses and their legitimacy. Known as ‘Sugar’ because of his vast holdings in the sugar industry, Aliyev is alleged to have abused his positionboth as President Nazarbayev’s son-in-law and apublic official to earn a fortune in a variety of industries.

According to a statement made to the High Court in London, Aliyev founded several private companies, including a sugar company and several radio and TV stations, from 1993-1996.79 The date is key, as Kazakh law states that a government official does not have the right to “do any other paid work other than teaching, scientific or other creative work… do any commercial work, including managing a commercial organisation.”80 According to Aliyev, on becoming a government official in 1997, his shares were held in trust by his lawyers, in accordance with Kazakh law.81 The list of companies that Aliyev swore under oath in 2012 that he owned consists of over 40 entities82 – an impressive array for someone who claims to have only been in business from 1993-1996 and from 2007 following his exile from Kazakhstan.

How did Aliyev get to be involved in so manycompanies? Serik Medetbekov, a Kazakh businessman who founded a media holding company in the late 90s, claimed in a written statement made to a courtin New York that in May 1999 a known associate of Rakhat Aliyev demanded that he transferred his media holdings to entities controlled by Aliyev: “in the event of my refusal to comply with his orders, I would suffer direct repercussions: tax and criminal proceedings would be opened against me on false


charges, resulting in imprisonment and possibly, physical elimination.”83 At this time Aliyev was the Deputy Head of the KNB, the secret police. Accordingto Medetbekov: “I was not the first person to be pressured into relinquishing his assets. Kazakhstan’s capital, Almaty, was full of examples of others who were coerced into transferring their assets to Mr. Aliyev and his family members and associates.”84 Medetbekov decided to leave Kazakhstan with his family later that year after “direct and imminent threats” to his life and safety had been made.85 Medetbekov is now a member of the Kazakhopposition in exile and is seeking compensation for the assets he says were misappropriated by Aliyev.86

In his statement to the High Court, Aliyev addressed allegations of ‘corporate raiding’, saying that such accusations were untrue and originated from President Nazarbayev, who was setting Aliyev up as a scapegoat: “Everyone would be led to believe that the country had a good president with an evil son-in-law trying to take the shirt off their backs.”87 In a draft version of Aliyev’s submission to the High Court, he elucidates more on what he meant: “It was awell-organized campaign that Nazarbayev had thought up to make these ‘little children’ think of me as the bogeyman. It started with large cases of expropriation.Then the fashion spread to the regional level, and soon even small private shops and outdoor stalls were being expropriated ’for Aliyev’.”88 These words were not included in Aliyev’s final submission.

Aliyev’s argument is curious – he did not deny

amassing a vast business empire, yet all the people

who claimed that he had misappropriated their

business were doing so because President

Nazarbayev had concocted a scheme to scapegoat

him in 1999 – at a time when Aliyev was happily

married to Nazarbayev’s daughter. Aliyev’s denials

hold no truck with former Kazakh Prime Minister

Akezhan Kazhegeldin, who states in a documentary

about Aliyev: “His forceful methods meant he took

what he wanted. ‘It doesn’t belong to you anymore.

It’s mine.’ There was no other option.”89

Could Aliyev have amassed an entirely legal business

empire before he became an official in 1997? It is

possible, but the sources above attest to the fact

that much of what he acquired originated from his

time in office.90 It is therefore arguable that most,

if not all, of Aliyev’s wealth may have originated from

illegitimate sources and therefore the assets that he

obtained after he left office should be treated as the

proceeds of crime. Yet while the debate over the

legitimacy of Aliyev’s Kazakh assets is beyond the scope

of this report, it is vital to consider that the mysterious

acquisition of real estate by persons unknown in

the UK took place amidst a backdrop of money

laundering investigations against Aliyev in the EU.

For example, in 2005, the German authorities

appear to have been conducting an investigation

into allegations of money laundering at Metallwerke

Bender with the assistance of the Austrian authorities.

Global Witness has seen a document that purports

to be a fax written from the German Federal Ministry

of the Interior (“BMI”) to the Austrian Interpol

authorities regarding a ‘suspicion of money laundering’.

According to this document, the individuals and

companies that they were investigating pursuant to

those allegations included Rakhat Aliyev, Armoreal,

Metallwerke and A.V. Maximus SA. Although there

were reports of Aliyev’s involvement in money

laundering in 2007,91 the German authorities’

investigation into Metallwerke only became public

in 2011.92 At the time of writing, the Austrian

authorities had not confirmed the status of the

investigation or the authenticity of the document.

The German authorities refused to comment.93President Nazarbayev of Kazakhstan. (Credit: © John Van Hasselt/Corbis)


As Aliyev’s wealth is alleged to have relied primarily onhis illegal misappropriation and raiding of businesses in Kazakhstan when he was a Kazakh public official,and as investigations into money laundering schemes perpetrated by Aliyev have been on-going in the EU from at least 2005, it is reasonable to assume that any companies and properties he owns, wherever their location, could be linked to money laundering, and further investigations by the UK authorities are warranted.

The most significant UK property purchases (such as Dynamic’s purchase of the 219 Baker St lease for over £98 million in 2010)94 occurred at a time when it would have been difficult for Aliyev to open a bank account, due to his high-profile nature and investigations into his business empire. For someone in his position, putting money into London’s ever-strengthening property market would have been a much safer bet. This is circumstantial evidence, and again the companies and people in question vehemently deny that Aliyev was ever the beneficial owner or that the property purchases are in any way part of a money laundering network. Kurmanbayev’s lawyers commented: “The property acquisitions referred to in your letter were handled by reputable international law firms, who conducted appropriate due diligence on the source of the funds used to purchase the properties. These law firms weresatisfied that the funds were from a legitimate source and not the proceeds of crime.”95

Yet someone acquired properties worth £147 million and it is in the public interest that the circumstantial evidence that links these properties to Rakhat Aliyev, Nurali Aliyev and Elnara Shorazova be investigated.

Through its campaigning, Global Witness has called attention to the fact that foreign officials are usinganonymous companies and the UK’s property market to launder their money. This entrenches the corruptionthat keeps citizens in poor countries poor, robs people of their futures, and threatens global stability.

Although the true owner of the properties inBaker Street remain a mystery, this investigation demonstrates how the UK can be used to hide the ownership of lucrative real estate and the funds

used to purchase such high-end property.

THE KEY PLAYERS’RESPONSE

Global Witness wrote to the companies and people identified in this report, namely Massimiliano Dall’Osso, Bernard Enry, Mukahmed Ali Kurmanbayev, Elnara Shorazova and Dynamic, Farmont and Parkview.

Lawyers representing Kurmanbayev, Dall’Osso and

the companies all provided near-identical responses.

They stated that Rakhat Aliyev was at no time the

ultimate beneficial owner of the controlling party of

Dynamic, Farmont and Parkview. Lawyers representing

Enry stated that Rakhat Aliyev never was the ultimate

beneficial owner of Villa Magna (the current owner

of the property in Highgate).

Kurmanbayev’s letter adds:

1. […] our client never had any relationship,

whether professional or personal with

Rakhat Aliyev, either directly or through

intermediaries. Nor has our client ever

met with or had any professional or

personal relationship with Rakhat Aliyev’s

widow, Elnara Shorazova.

2. The property acquisitions referred to in

your letter were handled by reputable

international law firms, who conducted

appropriate due diligence on the source of

the funds used to purchase the properties.

These law firms were satisfied that the

funds were from a legitimate source and

not the proceeds of crime.

3. Our client has never knowingly been

involved in any transaction which involved

laundering money for the proceeds of crime.

It is therefore incorrect to state that Rakhat

Aliyev was the beneficial owner of the Companies,

or that our client had any involvement in money

laundering, or indeed any other crime.96


The letters from Dynamic, Farmont, Parkview and

Dall’Osso “strenuously deny” any allegation that

Dall’Osso is involved in a money laundering network

with Rakhat Aliyev and Elnara Shorazova. The letters

add that all necessary and appropriate due diligence

was undertaken, and that at no time were the properties

put into Shorazova’s name.97

Enry’s letter “vigorously rejects” any allegation

that Villa Magna was a front for laundering Rakhat

Aliyev’s money and that Enry was involved.98

A lawyer representing Elnara Shorazova said the

following:

While Global Witness does not allege that the various

individuals and companies identified in this report

were knowingly involved in money laundering, it

is clear that there is an urgent need for the UK

authorities to investigate whether these structures

were established by Rakhat Aliyev, his inner circle

or the Kazakh first family to conceal the ownership

of the UK assets. It is similarly clear that the

corporate structures outlined in this report, which

are commonplace in the UK, are ripe for abuse.

This investigation also sits within a wider context of

suspect individuals having used complex corporate

structures to hide their identity.

As a matter of fact, our client lacks information

with regard to most of the issues and accusations

in your letter and therefore cannot comment

thereon. […] we would like to draw your attention

to the disinformation campaign against Mr.

Aliyev over the past few years. The Kazakh

regime has used immeasurable funds to

influence international media and politicians.

A recent examples of the Kazakh efforts

has been reported by the German weekly

magazine Der Spiegel. […] Kazakhstan paid

an “army” of diverse specialists, experts,

lawyers, NGOs, journalists, not to mention

European (ex)politician for the purpose of

persecuting Dr. Aliyev and to initiate all sort

of legal proceedings against him and his

surroundings in various jurisdiction. […] We

further would like to draw your attention to

the decisions of the Human Rights Court in

Strassbourg [sic] in the Case of Baysakov vs

Ukraine, in which the Court held that the Kazakh

Secrete [sic] Service (NSS) has tortured and

ill-treated people in order to obtain confessions

and statements against Dr. Aliyev.99 In short,

the Kazakh regime has exported its abusive

system to European countries and has abused

the legal system in Austria and other European

Countries to run a vendetta against Dr. Aliyev.

…

We do not have any information with regard

to the ownership structure of the companies

Farmont, Dynamic, Parkview and Greatex

Limited and we are also not aware about

their beneficial owners.

Mrs. Shorazova is neither an owner nor an

UBO of these companies.100


TIMELINE

• Rakhat Aliyev enters public office in Kazakhstan

• May: Rakhat Aliyev dismissed as Kazakh Ambassador to Austria • August: Austrian authorities launch investigation into Aliyev’s alleged money laundering• December: Greatex Limited registered in the UK; Greatex (Suisse) SA registered in

Geneva with 22-year-old Nurali Aliyev as President

• April: Farmont Investors Corp BVI buys company that owns £37.5m of Baker Street properties and renames it “Farmont Baker Street”

• April: Greatex Ltd puchases freehold of 231-237 Baker St, including the Beatles Store & Elvisly Yours

• October: Greatex Ltd sells this freehold, making over £1.1m gross profit

• March: Aliyev found guilty in Kazakhstan of plotting a coup against the president and sentenced to 20 years in prison. He goes into hiding in Europe

• April: A BVI company purchases Highgate mansion for £9.3m

• February: Maltese authorities freeze assets of Aliyev and his second wife• June: Aliyev turns himself in to Austrian authorities and is placed in custody• December: Aliyev is charged with murders of bankers in Austria

• March: Dynamic purchases for £98.475m the leasehold of 219 Baker Street

• Bodies of two Austrian bankers found in Kazakhstan; Aliyev accused of murders

• July: Maltese authorities launch investigation into Aliyev’s alleged money laundering

• February: Rakhat Aliyev is found hanged in Austrian jail cell

1997

2007

2009

2008

2014

2010

2011

2013

2015


WHERE ELSE IS THE USE OF COMPLEX CORPORATE STRUCTURES A PROBLEM?

The short answer is: everywhere. The OECD says that “almost every economic crime involves the misuse of corporate vehicles [i.e. companies and trusts]”101. In almost every case of crime and corruption that we investigate, Global Witness encounters this method. Some notable examples include:• The son of former Kyrgyz President Kurmanbek

Bakiyev lives in a £3.5 million mansion in the

Borough of Reigate and Banstead in Surrey,

despite being convicted in his homeland of the

attempted murder of a UK citizen and corruption.

The anonymous company that is being used

to hide the ownership of the Surrey mansion

can be linked to an alleged money-laundering

scheme used to get the funds out of Kyrgyzstan.102

• In 2011 two oil companies, Shell and Italy’s

Eni, paid $1.1billion for the rights to a lucrative

Nigerian oil concession called OPL245. They

paid the money to the Nigerian government,

which then made another payment for an

identical amount to a company called Malabu

Oil and Gas. This company was secretly owned by a man called Dan Etete, who had been the Nigerian oil minister at the time the block was originally awarded some years before. Etete had awarded the oil rights to his own company, and was now cashing in on his corruption. The missing money could have put 1.7 million girls through school, in a country where 5 million girls are out of school.103

• A Manhattan skyscraper on 5th Avenue was part-owned by a front for the Iranian government. Iran’s interests in the building were disguised via New York and Channel Island companies.104

• The British arms firm BAE Systems paid $400m to settle charges that it bribed Saudi officials responsible for approving a massive arms purchase,including by using UK shell companies.105

• A Russian crime boss described by the FBI as the “most dangerous mobster in the world”allegedly set up a network of anonymouscompanies stretching from Eastern Pennsylvania to the United Kingdom to cheat the stock market and steal over $150 million from investors in the United States and overseas.106

• The biggest of Mexico’s drug cartels used an anonymous Oklahoma company in a scheme to launder millions of dollars of drug money into the United States.107

A ‘beneficial owner’ is a natural person – that is, a real, live human being, not another company or trust – who directly or indirectly exercises substantial control over the company or receives substantial economic benefits from the company.

What is a ‘beneficial owner’?

Anonymous company owners can use their compan(ies) as a legal smokescreen for criminal and predatory activities. An anonymous company can do business like any other company, the only difference is it is incredibly difficult to find out who the actual human being(s) controlling it is. Instead, it can be owned by a “nominee” – someone who essentially rents out their name so that the real owner’s identity can be kept hidden – or just by another company that could also have anonymous owners. This makes it incrediblyhard for law enforcement and the general public to know who really owns the company, and what it is being used for. Gangsters and crooks regularly set up a series of companies that own each other. Stacked up like Russian dolls, and often crossing borders, they make it harder to figure out who is ultimately behind the company. These companies often serve no legitimate purpose, but to cover things up.

Anonymous owners and nominee shareholders – what are they?


The UK’s Prime Minister, David Cameron, has put the fight against corruption at the heart of the UK’s and G7’s agenda. (Credit: Flickr: Number 10)

CONCLUSION

This case and the pattern of secrecy behind it call for an urgent investigation into the true owners of the companies that own such valuable properties on one of London’s most famous streets. It highlightsthe urgent need for action to tackle the use and abuse of anonymous companies worldwide. There has been some promising progress on this in recent years – in 2014 the UK became the first country to commit to setting up a public registry of the real owners of companies.

And in June 2015 the Prime Minister David Cameron

put the fight against corruption at the heart of the

UK’s and G7’s agenda. But these steps are

undermined by blind spots when it comes to luxury

property and the companies that own them. At

present, neither the Land Registry nor the real estate

agents involved in deals are required to identify the

real owners of companies buying UK property. And

the UK’s Overseas Territories and Crown Dependencies,

which are the homes of many of the companies that

own these properties, are known to be some of the

most favoured jurisdictions of the corrupt in which to

incorporate anonymous companies.

While we are not alleging that the various individuals

and companies identified in this report were knowingly

involved in money laundering, it is clear that the type

of corporate structures outlined in this report are ripe

for abuse. All of this makes it all too easy to sink

suspect cash into London property, creating a loophole

which those with something to hide can easily

exploit, and facilitating corruption that can lead to

human rights abuses overseas.

If the government is serious about ending the role

that this great world city plays in fuelling corruption

in some of the poorest or most violent countries in

the world, it must close that loophole urgently.


ENDNOTES

1. The property portfolio that is the subject of this report sits directly adjacent to but does not include the Sherlock Holmes museum.

2. According to Land Registry documents, the freehold title to these properties was transferred out of the company network in December 2009.

3. Transparency International, “Corruption on your doorstep”, March 2015: http://www.transparency.org.uk/our-work/publications/15-publications/1230-corruption-on-your-doorstep.

4. Press Release, Global Witness welcomes the UK’s historical rollback of corporate secrecy, October 2013: https://www.globalwitness.org/archive/global-witness-welcomes-uks-historic-rollback-corporate-secrecy/.

5. David Cameron, “Corruption Is the Cancer at the Heart of So Many of the Problems We Face Around the World”, Huffington Post, 6 June 2015: http://www.huffingtonpost.co.uk/david-cameron/david-cameron-fifa-corruption_b_7524550.html.

6. BBC News, “Austria post-mortem finds Kazakh death was suicide”, 25 February 2015: http://www.bbc.co.uk/news/world-europe-31602113.

7. BBC News, “Kazakh pair in Austria trial after Aliyev jail death”, 14 April 2015: http://www.bbc.co.uk/news/world-europe-32253434; The Independent (Malta), “Aliyev case: Co-accused released from pre-trial custody over dubious testimony”, 30 April 2015: http://www.independent.com.mt/articles/2015-04-30/local-news/Aliyev-case-Co-accused-released-from-pre-trial-custody-over-dubious-testimony-6736134704.

8. Aliyev provided a written statement to a High Court in the UK in relation to a high profile case involving another former Kazakh government official turned dissident, Mukhtar Ablyazov. Though a final English version of his statement has not been made public, Global Witness has seen a draft version in English and a Russian translation of the final version that Aliyev posted on his website: Draft Witness Statement of Rakhat Mukhtarovich Aliyev, JSC BTA Bank v Mukhtar Ablyazov & Ors (High Court of Justice, Queen’s Bench Division, Commercial Court) (“Draft Aliyev Statement”), para 22.

9. Draft Aliyev Statement, para 25.

10. See p5 of this report: EU investigations.

11. Financial Times, “President firm as change bypasses Kazakhstan”, 31 March 2011: http://www.ft.com/cms/s/0/94f35f1e-5bbc-11e0-b8e7-00144feab49a.html#axzz3f8Rf87rt.

12. Central Asia Today, “Kazakhstan: Nazarbayev Grandson Assumes Astana Power Post”, 21 December 2014: http://www.eurasianet.org/node/71431.

13. Central Asia Today, “Kazakhstan: Nazarbayev Grandson Assumes Astana Power Post”, 21 December 2014: http://www.eurasianet.org/node/71431.

14. Central Asia Today, “Kazakhstan: Nazarbayev Grandson Assumes Astana Power Post”, 21 December 2014: http://www.eurasianet.org/node/71431; Russia Insider, “Suicide of Kazakh President’s Former Son-in-Law Clears Succession Path”, 2 March 2015: http://russia-insider.com/en/2015/03/02/4037.

15. Global Witness, “Risky Business”, July 2010, p16: https://www.globalwitness.org/sites/default/files/pdfs/gw_risky_business.pdf: “According to government statistics, 22 percent of the 2,479 media outlets were government-owned. The overwhelming majority of broadcast media considered to be independent, including the larger outlets, were owned by holding companies believed to be controlled by members of the president’s family and close circle of friends”; US Department of State, 2006 Country Reports on Human Rights Practices: Kazakhstan, 6 March 2007: http://www.state.gov/j/drl/rls/hrrpt/2006/78820.htm: “The law does not adequately provide for an independent judiciary. The executive branch limited judicial independence”; US Department of State, 2009 Country Reports on Human Rights Practices: Kazakhstan, 11 March 2010: http://www.state.gov/j/drl/rls/hrrpt/2009/sca/136088.htm: “In the 2007 elections for the Mazhilis, President Nazarbayev’s Nur Otan party, the country’s dominant political force, received 88 percent of the vote, winning every seat in the chamber. No other party received the necessary 7 percent of the vote to obtain Mazhilis seats… Opposition leaders filed 400 court cases alleging violations. The courts dismissed or denied the majority of the cases.”

16. Global Witness, “Time for Transparency”, March 2004: https://www.globalwitness.org/documents/17833/time_for_transparency.pdf, pp7-9.


18. Draft Aliyev Statement, para 11; Final Witness Statement of Rakhat Mukhtarovich Aliyev, JSC BTA Bank v Mukhtar Ablyazov & Ors (High Court of Justice, Queen’s Bench Division, Commercial Court) (“Final Aliyev Statement”), para 10. Also reported in BBC News, “Kazakh pair in Austria trial after Aliyev jail death”, 14 April 2015: http://www.bbc.co.uk/news/world-europe-32253434.

19. Draft Aliyev Statement, para 227. EurasiaNet, “Kazakhstan: Coup Trial May Have Dented Government’s Image”, 30 March 2008: http://www.eurasianet.org/departments/insight/articles/eav033108a.shtml.

20. Draft Aliyev Statement, para 1; Final Aliyev Statement, para 1.

21. The Independent, “Rakhat Aliyev: Businessman and diplomat who exploited his connections to make a fortune but was due to stand trial for mur-der”, 27 February 2015: http://www.independent.co.uk/news/people/rakhat-aliyev-businessman-and-diplomat-who-exploited-his-connections-to-make-a-fortune-but-was-due-to-stand-trial-for-murder-10073656.html; Malta Today, “Kazakh exile Rakhat Aliyev applies for Cypriot citizenship”, 24 December 2013: http://www.maltatoday.com.mt/news/national/32598/aliyev-applies-for-cypriot-citizenship-20131223; The Independent (Malta), “Aliyev case: Co-accused released from pre-trial custody over dubious testimony”, 30 April 2015: http://www.independent.com.mt/articles/2015-04-30/local-news/Aliyev-case-Co-accused-released-from-pre-trial-custody-over-dubious-testimony-6736134704.


23. Draft Aliyev Statement, paras 1 and 13; Final Aliyev Statement, paras 1 and 13.


25. Forbes, “The KGB’s Successor Is Using Forged Documents To Deceive The West”, 3 September 2014: http://www.forbes.com/sites/real-spin/2014/09/03/the-kgbs-successor-is-using-forged-documents-to-deceive-the-west/.



27. BBC News, “Austria charges Kazakhstan dissident Aliyev with murder”, 30 December 2014: http://www.bbc.co.uk/news/world-europe-30635234.

28. BBC News, “Kazakh pair in Austria trial after Aliyev jail death”, 14 April 2015: http://www.bbc.co.uk/news/world-europe-32253434; The Independent (Malta), “Aliyev case: Co-accused released from pre-trial custody over dubious testimony”, 30 April 2015: http://www.independent.com.mt/articles/2015-04-30/local-news/Aliyev-case-Co-accused-released-from-pre-trial-custody-over-dubious-testimony-6736134704.

29. Times of Malta, “Rakhat Aliyev charged with murders”, 2 January 2015: http://www.timesofmalta.com/articles/view/20150102/local/Rakhat-Aliyev-charged-with-murders.550293; BBC News, “Austria charges Kazakhstan dissident Aliyev with murder”, 30 December 2014: http://www.bbc.co.uk/news/world-europe-30635234.

30. Tengrinews, “Rakhat Aliyev’s arrest confirmed by Vienna Prosecutors”, 7 June 2014: http://en.tengrinews.kz/crime/Rakhat-Aliyevs-arrest-con-firmed-by-Vienna-Prosecutors-254013/; EurasiaNet, “Kazakhstan: Coup Trial May Have Dented Government’s Image”, 30 March 2008: http://www.eurasianet.org/departments/insight/articles/eav033108a.shtml.

31. BBC News, “Germany’s Koehler and Schroeder reject Kazakh lobby claims”, 17 June 2015: http://www.bbc.co.uk/news/blogs-eu-33169051.

32. Email from Dietrich Rechtsanwalts GmbH to Global Witness on behalf of Elnara Shorazova, dated 17 June 2015.

33. YouTube, Andreo Bonelli, “Rakhat Aliyev – History has no statute of limitations / Shoraz – English” (“Rakhat Aliyev”), 27 February 2013: https://www.youtube.com/watch?v=OsOqHqEkips (7’00).

34. Malta Today, “Rakhat Aliyev victims vow to take their case to Strasbourg”, 26 November 2012: http://www.maltatoday.com.mt/news/nation-al/22911/rakhat-aliyev-victims-vow-to-take-their-case-to-strasbourg-20121124; YouTube, MaltaToday, “Torture allegations against Rakhat Aliyev”, 24 November 2012: https://www.youtube.com/watch?v=WapydXQlTAk; YouTube , Andreo Bonelli, “Rakhat Aliyev ”, 27 February 2013: https://www.youtube.com/watch?v=OsOqHqEkips (16’19 to 20’30; 54’35).

35. YouTube, Andreo Bonelli, “Rakhat Aliyev”, 27 February 2013: https://www.youtube.com/watch?v=OsOqHqEkips (7’28).

36. Deutsche Welle, “Rakhat Aliyev interested in both Maltese and German investigators”, 15 June 2013: http://bit.ly/1CEB2XZ.

37. Radio Free Europe/Radio Liberty, “Kazakhstan: Criminal Scandal Widens Around Ex-Ambassador Aliev”, 22 June 2015: http://www.rferl.org/content/article/1078389.html; “Kazakh President’s Daughter Divorces Fugitive Husband, 12 June 2007: http://www.rferl.org/content/ar-ticle/1077083.html.

38. Malta Today, “Investigators told of Rakhat Aliyev’s alleged money laundering network”, 30 July 2013: http://www.maltatoday.com.mt/news/na-tional/28709/investigators-told-of-rakhat-aliyev-s-alleged-money-laundering-network-20130729; Written Parliamentary Question to the European Parliament by Ana Gomes (Portuguese Socialist Member of the European Parliament), December 2013 on “Money laundering accusations at EU level against Rakhat Aliyev”: http://www.europarl.europa.eu/sides/getDoc.do?pubRef=-//EP//TEXT+WQ+E-2013-014020+0+DOC+XML+V0//EN. The answer from the Parliament given was: “the Commission is aware, through media reports, of the investigations conducted against Rakhat Aliyev, notably related to money laundering. While the facts investigated may have cross-border elements or even a European dimension, the EU has no competence to conduct criminal law investigations. The Commission systematically encourages Member States’ cooperation with Europol and has also introduced in its proposal for a new Europol regulation a provision obliging Member States to supply Europol with the data necessary for it to fulfil its objectives. In addition, the Commission and Europol encourage the setting up of joint investigation teams. While the Commission follows developments in Member States in general terms and looks into how cooperation is functioning in cross-border cases in practice, the Commission is not monitoring individual investigations”: Answer given by Ms Malstrom on behalf of the Commission, February 2014: http://www.europarl.europa.eu/sides/getAllAnswers.do?reference=E-2013-014020&language=EN.

39. Decree given by the Maltese Criminal Court (Mr Justice Lawrence Quintano LL.D) after an application filed by the Attorney General dated 25 February 2014 in the names of Rakhat and Elnara Shorazova.

40. Email from Maltese Criminal Courts and Tribunals to Global Witness, 10 June 2015.

41. Deutsche Welle, “Rakhat Aliyev interested in both Maltese and German investigators”, 15 June 2013: http://bit.ly/1CEB2XZ; TAGDYR Foundation, “The ‘Nurbank’ Murder Case”: http://en.tagdyr.net/the-nurbank-murder-case.

42. Although there has been recent media coverage of an apparently concerted campaign to discredit Rakhat Aliyev led by President Nazerbayev through the filing of complaints in Germany and Malta: see BBC News, “Germany’s Koehler and Schroeder reject Kazakh lobby claims”, 17 June 2015: http://www.bbc.co.uk/news/blogs-eu-33169051 and “The Key Player’s Response” in this report.

43. Final Aliyev Statement, para 209.


45. Bloomberg, “Aliyev’s Death in Prison Probably Suicide, Prosecutors Say”, 25 February 2015: http://www.bloomberg.com/news/arti-cles/2015-02-25/video-autopsy-point-to-suicide-in-aliyev-death-prosecutors-say. The Independent, “Rakhat Aliyev: Claims of murder over death of rival to Kazakhstan’s president in Austrian prison” (“Rakhat Aliyev: Claims of murder”), 15 March 2015: http://www.independent.co.uk/news/world/asia/rakhat-aliyev-claims-of-murder-over-death-of-rival-to-kazakhstans-president-in-an-austrian-prison-10108693.html.

46. The Independent, “Rakhat Aliyev: Claims of murder”, 15 March 2015: http://www.independent.co.uk/news/world/asia/rakhat-aliyev-claims-of-murder-over-death-of-rival-to-kazakhstans-president-in-an-austrian-prison-10108693.html.

47. The Sherlock Holmes Museum: http://www.sherlock-holmes.co.uk/.

48. Smithsonian, “The Mystery of 221B Baker Street”, 18 July 2012: http://www.smithsonianmag.com/arts-culture/the-mystery-of-221b-baker-street-3608784/?no-ist.

49. The Beatles Store London: http://www.beatlesstorelondon.co.uk/.

50. Elvisly Yours: http://www.elvisly-yours.com/index.php?page=fdlink.html. The shop closed its doors after the sale of the freehold on 1 April 2010.

51. Smithsonian, “The Mystery of 221B Baker Street”, 18 July 2012: http://www.smithsonianmag.com/arts-culture/the-mystery-of-221b-baker-street-3608784/?no-ist.

52. Map and title plan of 221 Baker Street, as found on Land Registry title documents.

53. This information comes from the Land Registry and company documents for these properties and companies.


54. Letters to Global Witness from Massimiliano Dall’Osso and Farmont, Dynamic and Parkview, dated 19 June 2015.

55. The minutes of the process relating to the execution of a request for legal assistance in respect of Rakhat SHORAZA, (321 ST 3/log), held February 16, 2012 in the Magistrates Court (Malta) with the participation of judges, Dr. Claire L. Stafreys Zammit, B. A. LL. D. Dr. Rahat Shoraz, while answering questions from the Austrian public prosecutor Dr. Beftina Sciences Wallner (“Maltese court document”).

56. Malta Today, “Investigators told of Rakhat Aliyev’s alleged money laundering network”, 30 July 2013: http://www.maltatoday.com.mt/news/na-tional/28709/investigators-told-of-rakhat-aliyev-s-alleged-money-laundering-network-20130729.

57. This hotel bill appears to have been uploaded to the Scribd website by Aliyev himself: https://www.scribd.com/Rakhat%20Aliev.

58. Republik Osterreich Firmenbuch (Austrian commercial register), entry for Armoreal, accessed June 2015; Maltese court document.

59. Handelsregister anfordern (German commercial register), entry for Metallwerke, accessed June 2015; Kazworld, “Rakhat Aliyev’s exotic cash laundering trail: Caribbean dimensions revealed”, 18 February 2013: http://kazworld.info/?p=27810.

60. Handelsregister anfordern (German commercial register), entry for Metallwerke, accessed June 2015; LinkedIn profile for Massimiliano Dall’Osso.

61. Republik Osterreich Firmenbuch (Austrian commercial register), entry for Armoreal, accessed June 2015; Maltese court document.

62. Letter to Global Witness from Massimiliano Dall’Osso, dated 19 June 2015.

63. Eurasianet, “Kazakhstan: The Plot Thickens in Nuclear Industry Probe”, 14 December 2009: http://www.eurasianet.org/departments/insight/ar-ticles/eav121509.shtml; Free Asia Blog, “Does Rahat Aliev have a new wife?”, 25 May 2009: http://freeasia.livejournal.com/1767.html; European Dialogue, “Viennese dream of Kazakh opposition”, 15 March 2011: http://www.eurodialogue.eu/Viennese-dream-of-kazakh-opposition; Tengri News, “Rakhat Aliyev tries to buy Malta Today but fails ... and starts accusing it of being biased”, 26 November 2012: http://en.tengrinews.kz/crime/Rakhat-Aliyev-tries-to-buy-Malta-Today-but-fails--and-starts-14782/; and Malta Today, “Kazakh millionaire in murder inquiry ‘hosted’ in Malta despite police objections”, 25 June 2012: http://www.maltatoday.com.mt/news/national/19119/kazakh-millionaire-in-murder-inquiry-host-ed-in-malta-despite-police-objections-20120625#.VXoXxM9Vikq.

64. As of June 2015.

65. From 4 August 2014, Dall’Osso has been Director of Farmont and Dynamic From 17 March 2010, Dall’Osso has been Director of Parkview.

66. Letter from Massimiliano Dall’Osso, dated 19 June 2015.

67. Malta Today, “Investigators told of Rakhat Aliyev’s alleged money laundering network”, 30 July 2013: http://www.maltatoday.com.mt/news/nation-al/28709/investigators-told-of-rakhat-aliyev-s-alleged-money-laundering-network-20130729. However note that the links between the companies were made by Austrian lawyers Lansky Ganzger Partner, who represent the widows of the two Nurbank bankers allegedly murdered by Aliyev or on his orders - accusations which Aliyev denies. This law firm has been identified in news reports as having been retained by Kazakhstan to lobby in Eu-rope: BBC News, “Germany’s Koehler and Schroeder reject Kazakh lobby claims”, 17 June 2015: http://www.bbc.co.uk/news/blogs-eu-33169051.

68. Moneyhouse result for AV Maximus.

69. Registration document for Villa Magna.

70. Letter from Bernard Enry to Global Witness, dated 30 June 2015.

71. Orbis result.

72. Registered 6 December 2007, Orbis result for G Wealth Management SA.

73. Nurali Aliyev resigned in November 2008: Moneyhouse result for G Wealth. In his letter of 30 June 2015, Mukhamed Ali Kurmanbayev confirmed that Nurali Aliyev of Greatex (Suisse) SA is Rakhat Aliyev’s son.

74. LinkedIn profile for Mukhamed Ali Kurmanbayev; confirmed in Letter to Global Witness from Mukhamed Ali Kurmanbayev, dated 19 June 2015.

75. Companies House result for Diamond Hangar.

76. Orbis result for Greatex Trade & Investment Corp.

77. LinkedIn profile for Mukhamed Ali Kurmanbayev; confirmed in Letter to Global Witness from Mukhamed Ali Kurmanbayev, dated 19 June 2015.

78. Letter from Mukhamed Ali Kurmanbayev to Global Witness, dated 30 June 2015.

79. Draft Aliyev Statement, para 24; Final Aliyev Statement, para 25. In the English version, he gives examples of Sugar Centre Ltd, KTK (TV channel) and Karavan (newspaper). In the Russian version, he gives examples of Sugar Centre, AlmaTV, Khabar, NTK (all TV channels), Evropa Plus Kazakhstan and Russian Radio Kazakhstan (radio stations) and others.

80. Article 10, “Limitations linked to working for the state”, the Law of the Republic of Kazakstan on Public Service; Draft Aliyev Statement, para 24.

81. Final Aliyev Statement, para 25; Draft Aliyev Statement, para 24.

82. Maltese court document.

83. In June 2011, Medetbekov submitted a written statement to arbitration proceedings in New York, regarding another case that Aliyev had submitted a statement to. The statement that Aliyev made to this court has not been made public, but Aliyev posted a Russian translation of the statement to the High Court on his website. Medetbekov says that his statement is based on what Aliyev claims in his submission to the UK court: Written Submission of a Non-Disputing Party, submitted by Serik Medetbekov, Caratube International Oil Company LLP v The Republic of Kazakhstan, ICSID Case No. ARB/08.12 (“Medetbekov statement”), paras 8, 11 and 19. Aliyev claims that he founded Russkoye Radio in the statement to the High Court; according to Medetbekov the station was only founded in 1998 when Aliyev was a public official, so even if Aliyev’s claim to it was legitimate it would have been illegal under Kazakh law for Aliyev to be involved in such business activity at this time. Medetbekov is now attempting to find compensation for the company he says was forcibly misappropriated by Aliyev.

84. Medetbekov statement, para 19.

85. Medetbekov statement, paras 26 and 27.

86. Eurasia-Internet, “Millions painted in blood”, 2 March 2015: http://neweurasia.info/en/index.php/events-and-opinions/1064-millions-painted-in-blood.



88. Draft Aliyev Statement, para 29; Final Aliyev Statement paras 28-31.

89. YouTube, Andreo Bonelli, “Rakhat Aliyev”, 27 February 2013: https://www.youtube.com/watch?v=OsOqHqEkips (37’20).

90. For example, Aliyev claims in the Final Aliyev Satement that he founded a radio station, Russkoye Radio, between 1993-1996. Yet, according to Medetbekov, not only was this company not Aliyev’s, but Medetbekov’s, it was only founded in 1998 – at a time when Aliyev was a public official: Medetbekov statement.

91. Radio Free Europe/Radio Liberty, “Kazakhstan: Aliev’s Bodyguards Return to Testify Against Him”, 18 September 2007: http://www.rferl.org/content/article/1347643.html. Radio Free Europe/Radio Liberty, “Kazakhstan: Criminal Scandal Widens Around Ex-Ambassador Aliev”, 28 August 2007: http://www.rferl.org/content/article/1078389.html. Radio Free Europe/Radio Liberty, “Kazakh President’s Daughter Divorces Fugitive Husband”, 12 June 2007:http://www.rferl.org/content/article/1077083.html ; https://www.documentcloud.org/documents/2094630-2007-news-report-mentioning-aliyevs-involvement.html.

92. Westdeutsche Zeitung, “Metallwerke Bender mit dubiosen Investoren - Geldwäsche in Gellep?”, 20 November 2011: http://www.wz-newsline.de/lokales/krefeld/metallwerke-bender-mit-dubiosen-investoren-geldwaesche-in-gellep-1.824551.

93. Emails from the German Ministry to Global Witness, June 2015.

94. Land registry title documents.



97. Letters from Massimiliano Dall’Osso, Farmont, Dynamic and Parkview to Global Witness, dated 19 June 2015.

98. Letter from Bernard Enry to Global Witness, dated 19 June 2015.

99. European Court of Human Rights, Judgement on “Case of Baysakov and Others v. Ukraine”, 18 February 2010: http://hudoc.echr.coe.int/sites/eng/pages/search.aspx?i=001-97437#{“itemid”:[“001-97437”]} , paras 33, 50.

100. Email from Elnara Shorazova to Global Witness, dated 17 June 2015.

101. OECD, “Behind the Corporate Veil: Using Corporate Entities for Illicit Purposes”, 2001: http://www.oecd.org/corporate/ca/43703185.pdf.

102. Global Witness, “Surrey Mansion Used to Hide Suspect Funds”, 25 March 2015: https://www.globalwitness.org/reports/surrey-mansion-used-hide-suspect-funds/.

103. Global Witness, “Nigeria’s Missing Billion”, 13 June 2013: https://www.globalwitness.org/campaigns/oil-gas-and-mining/nigeria--and-missing-billion/.

104. Global Witness, “NY skyscraper owned by government of Iran”: http://greatripoffmap.globalwitness.org/#!/case/57949.

105. Jason Sharman, “The Money Laundry: Regulating Criminal Finance in the Global Economy”, 2011, p76.

106. Global Witness, “The Great Rip Off”, 25 September 2014: https://www.globalwitness.org/campaigns/corruption-and-money-laundering/great-rip-off/.

107. Global Witness, “The Great Rip Off”, 25 September 2014: https://www.globalwitness.org/campaigns/corruption-and-money-laundering/great-rip-off/.

Global Witness investigatesand campaigns to change the system by exposing the economic networks behindconflict, corruption and environmental destruction.

Global Witness is a company limited by guaranteeand incorporated in England(Company No. 2871809).

ISBN 978-0-9923128-2-6

Global WitnessLloyds Chambers1 Portsoken StreetLondon E1 8BTUnited Kingdom

[email protected]

© Global Witness, 2014

Design – www.NickPurser.comCover image photography credit: urbanbuzz / Shutterstock.com

Resource Mystery on Baker Street

Documents

Transcript of Resource Mystery on Baker Street